Sullivan and Cromwell accused of being ‘fraudulent partners in FTX’ — Crypto Briefing

• According to legal documents dated February 16, a group of FTX creditors represented by Edwin Harrison have filed a class action lawsuit against prestigious law firm Sullivan and Cromwell (SandC), alleging that the firm knowingly provided services and assistance that directly contributed to FTX’s fraudulent actions.

FTX could not have perpetrated such an enormous fraud alone; SandC’s vast resources, regulatory connections, expertise and assistance were essential to the scheme,” the document states.

The lawsuit accuses SandC of engaging in civil conspiracy, aiding and abetting fraud and fiduciary breaches, and participating in a RICO enterprise allegedly run by FTX and its former CEO Sam Bankman Fried (SBF). Structure and Operations.

Specifically, the lenders allege that SandC used its legal experience, regulatory expertise and extensive resources to enforce FTX’s deceptive practices. According to the complaint, Ryne Miller, a former SandC lawyer who became general counsel for FTX US, had regulatory connections and was a key figure in establishing the close relationship between SandC and FTX.

Miller is believed to have used his connections to smooth FTX’s path through obstacles such as the acquisition of LedgerX, which was allegedly funded with stolen money.

Rayne Miller’s connections to regulators were crucial in making the deal happen. “ With Miller’s arrival and SandC’s leadership, FTX communicated directly with CFTC Commissioner Rostin Behnam, and Miller and SBF had numerous direct exchanges, conversations on Zoom and dinners together discussing “very urgent LedgerX issues,” “stablecoin’s potential regulatory framework,” and the CFTC’s “ongoing involvement” in FTX US’ acquisition of LedgerX, the statement said.

The lenders allege that SandC knew about FTX’s misuse of funds and problems with regulators, but continued to provide services. The statement cites the round-trip transaction and the acquisition of Robinhood through Emergent as examples of SandC’s alleged involvement in transactions that illegally diverted customer funds.

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